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Timothy Banks is Facing a Suitability Dispute

Timothy Banks (CRD #: 4497630), a previously registered broker with Private Client Services, is the subject of an investor dispute. This is according to his BrokerCheck record, accessed on April 3, 2024. Keep reading if you have questions regarding this alleged conduct. 

Investor Allegations 

On January 29, 2024, an investor alleged that Timothy Banks recommended an investment that did not suit their investment objectives and risk tolerance. 

This is not the only suitability allegation on his record. On July 28, 2020, an investor alleged that Timothy Banks recommended non-traded REITs and other alternative investments that did not suit the investor’s financial goals. 

What Are REITs?

Real estate investment trusts (REITs) allow investors to generate returns from a portfolio of real estate without being directly involved in property management. However, REITs tend to be illiquid, which makes them unsuitable for many investors. Non-traded REITs are especially risky because they are not traded on the public exchange, making them difficult or impossible to sell. 

What is a Suitable Investment?

FINRA defines suitable investments as securities that fit an investor’s profile. An investor’s profile includes information about their risk tolerance, financial goals, and age. 

FINRA Rule 2111 identifies the three prongs of a suitability determination as 1) reasonable-basis suitability, 2) customer-specific suitability, and 3) quantitative suitability.

  1. Reasonable-basis Suitability: Brokers are required to use reasonable diligence before making a recommendation. This means they have an obligation to understand an investment strategy and its potential risks or rewards.
  2. Customer-specific Suitability: Before recommending a particular security or investment strategy involving a specific client, brokers are required to have reasonable grounds for believing it will be suitable based on that client’s personal profile. The profile includes information on the investor’s financial goals, investing experience, and risk tolerance. 
  3. Quantitative Suitability: Brokers with control over a customer’s account must have a reasonable basis to believe that the series of transactions they recommend are not excessive before executing them. Excessive transactions run the risk of incurring too many fees and negating any returns. 

Investors who rely on their brokers for recommendations may be able to recover their losses through FINRA arbitration.

Background Information 

Timothy Banks has passed the following exams: 

  • Series 65 Uniform Investment Adviser Law Examination 
  • Series 66 Uniform Combined State Law Examination
  • SIE – Securities Industry Essentials Examination 
  • Series 7 General Securities Representative Examination 

During his 18 years of experience, Timothy Banks has registered with seven firms. These are the three most recent: 

  • Private Client Services (CRD #: 120222)
  • LPL Financial (CRD #: 6413) 
  • National Planning Corporation (CRD #: 29604) 

Kurta Law Can Help 

If you have worked with Timothy Banks and have concerns about your investments, do not hesitate to contact us at 877-600-0098 or info@kurtalawfirm.com for a free consultation. 

For nearly 20 years, Kurta Law has advocated for investors to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm that exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf. Do not let securities fraud go unchecked. Start your recovery process today.